This article first appeared on GuruFocus.
Tesla (TSLA, Financials) hit a speed bump in China last month. The electric vehicle maker sold just over 61,000 cars built at its Shanghai factory nearly 10% fewer than a year ago, according to the China Passenger Car Association.
That drop wiped out the modest growth Tesla saw in September. Production and exports from the Shanghai plant which ships Model 3s and Model Ys to Europe, India, and beyond fell more than 30% from the prior month.
The decline highlights how crowded China’s EV market has become. Local rival BYD also stumbled, with global sales down 12% in October its steepest drop in nearly two years. Both companies are contending with fierce price competition and a flood of budget EVs from newer brands.
Tesla hasn’t yet released the cheaper versions of its Model 3 and Model Y in China that recently launched in Europe. Analysts say that could change soon and might be key to regaining momentum heading into 2026.
In the meantime, Tesla is turning heads with something new. The company is showcasing its long-awaited Cybercab robotaxi in Shanghai this week. It’s still unclear when, or if, the autonomous vehicle will start operating on Chinese roads, where local players like Baidu and Pony.ai are already testing their own self-driving fleets.
Despite the slowdown, Tesla remains a major force in China’s EV landscape and investors will be watching closely to see whether new models or a more affordable lineup can reignite its growth.
